NHL Expansion back on agenda?

[mouser]

Not supposed to piss off potential customers.

And now the NHL is talking out of both sides of their mouth about expansion, they moved Phoenix, and according to Forbes (which is all we have), only a handful of teams are worth 1 billion plus.


Where is he wrong?

Forbes franchise estimates are always reactive, not proactive. No one thought a below average NBA team was worth $2B until Balmer bought the Clippers.

The 2023 Forbes guesstimates have 21 of 32 NHL teams valued at $1B+, hardly a handful. And since their 2023 publication two of the bottom 11 sold for $1B+.

I’m predicting when the new 2024 Forbes list comes out later this year they’ll have 25+ of 32 teams at $1B+ valuations.

 

[Voight]

Supply and demand is the only thing driving up team valuations.

Well, no kidding, Owning a NA pro sports team puts you in a. exclusive club of 124 (across the big four leagues) or 154 if you include MLS. There's 1,011 Billionaires in North America (obviously not all of them care to own. sports team).

It's why Ballmer overpaid for the Clippers. He desperately wanted to be in said club.

 

[ponder719]

Well, no kidding, Owning a NA pro sports team puts you in a. exclusive club of 124 (across the big four leagues) or 154 if you include MLS. There's 1,011 Billionaires in North America (obviously not all of them care to own. sports team).

It's why Ballmer overpaid for the Clippers. He desperately wanted to be in said club.

And of course the number's materially smaller than 124/154 (if you're looking at controlling ownership only), because of the number of teams owned by the same person or family (Josh Harris with the Sixers, Commanders, and Devils, Stan Kroenke with the Rams, Nuggets, Rapids, and Avalanche, etc.), and the lone outlier of the Green Bay Packers. If you truly want in, you have very, very few opportunities, so you have to maximize them when they come open.

 

[aqib]

All true, but he wants an arena. Not sure Harris County will give him one without an NHL team.

What is any of that based on?

Not supposed to piss off potential customers.

And now the NHL is talking out of both sides of their mouth about expansion, they moved Phoenix, and according to Forbes (which is all we have), only a handful of teams are worth 1 billion plus.


Where is he wrong?

The league always talks out of both sides of its mouth on expansion and relocation. The Thrashers weren't going anywhere until they were. At the All-Star Game Bettman said he beleived AM was heading towards a deal. The Coyotes were staying until the last week.

Forbes said a year ago the average NHL team is worth $1.33B and valued 21 out of 32 at over $1 billion. Thats far from a handful.

https://www.forbes.com/lists/nhl-valuations/ One of the ones below a billion was the Coyotes who just sold for $1.2B. Forbes also said that valuations went up 29% from 2023. If you added another 29% to all the other teams everyone but Buffalo and Columbus would be over $1 billion.

If you put out an open bid at say $1.4 billion you would get multiple bids but not from Fertita. Someone not willing to pay your price is not a potential customer. If I'm not willing to pay $100 for a lobster then I'm not a potential customer of a highend lobster restaurant.

 

[aqib]

Well, no kidding, Owning a NA pro sports team puts you in a. exclusive club of 124 (across the big four leagues) or 154 if you include MLS. There's 1,011 Billionaires in North America (obviously not all of them care to own. sports team).

It's why Ballmer overpaid for the Clippers. He desperately wanted to be in said club.

Honestly I think there are more billionaires than that. The only ones that get on the list are the ones who own publicly traded companies. Part fo the reason MLS teams have gone up in value is that's the only league you can buy into for under $1B. The NFL only broke into $1B territory in 2012. Now $1B only gets you small market NHL

 

[StreetHawk]

If you put out an open bid at say $1.4 billion you would get multiple bids but not from Fertita. Someone not willing to pay your price is not a potential customer. If I'm not willing to pay $100 for a lobster then I'm not a potential customer of a highend lobster restaurant.

End of the day, arenas mean everything in the sports world. If in the end, neither side budges between the NHL and TF, then Houston won't get a team. Each city/county is different, so maybe there isn't a situation that would make an ATL type plan work in the Houston area.

With regards to the Toyota Center, haven't heard anything negative about it. What is unique about it is that Les Alexander didn't want fans to walk up to the seats, so the arena, like Climate Pledge in seattle, dug down a couple of stories. If it has the space to allow for all of the current trends in sports arenas, I would expect them to just do a renovation on it.

 

[Melrose Munch]

What is any of that based on?



The league always talks out of both sides of its mouth on expansion and relocation. The Thrashers weren't going anywhere until they were. At the All-Star Game Bettman said he beleived AM was heading towards a deal. The Coyotes were staying until the last week.

Forbes said a year ago the average NHL team is worth $1.33B and valued 21 out of 32 at over $1 billion. Thats far from a handful.

https://www.forbes.com/lists/nhl-valuations/ One of the ones below a billion was the Coyotes who just sold for $1.2B. Forbes also said that valuations went up 29% from 2023. If you added another 29% to all the other teams everyone but Buffalo and Columbus would be over $1 billion.

If you put out an open bid at say $1.4 billion you would get multiple bids but not from Fertita. Someone not willing to pay your price is not a potential customer. If I'm not willing to pay $100 for a lobster then I'm not a potential customer of a highend lobster restaurant.

Toyota center is getting up there in years. Sure, they could renovate, but would it not be better to lock down an extra 40 or so dates to justify the cost?
Ok so I was looking at the older forbes lists, to be fair, but tbf they don't have all the info. My point is that I'm not sure he is wrong when saying the return on profit or otherwise costs don't justify the expenditure.

You're right that he's not a customer, but they need him more because there are no other groups in the Houston area, unlike Atlanta. I'm sure we don't think the Coyotes were actually worth 1.2 billion. But they sold as that. And you're right Fertita won't want to pay that. The NHL should be realistic with its prices.

 

[StreetHawk]

Toyota center is getting up there in years. Sure, they could renovate, but would it not be better to lock down an extra 40 or so dates to justify the cost?

The Toyota Center was built and designed to accommodate NHL hockey. They did have ice machines, which were removed after the Aeros left, but have/can be re-installed. They don't need a new arena to host an NHL team, Toyota Center can do that.

For a comparison, the Texans stadium opened in 2002 a year earlier. I don't think that's pending a tear down in the next decade. Personally, I do shake my head at how quickly it appears a lot of sports teams want to replace their current stadium/arena. Titans stadium opened in 1999 and they will have a new one in the coming years. It's 25 years old this year.

 

[Melrose Munch]

The Toyota Center was built and designed to accommodate NHL hockey. They did have ice machines, which were removed after the Aeros left, but have/can be re-installed. They don't need a new arena to host an NHL team, Toyota Center can do that.

For a comparison, the Texans stadium opened in 2002 a year earlier. I don't think that's pending a tear down in the next decade. Personally, I do shake my head at how quickly it appears a lot of sports teams want to replace their current stadium/arena. Titans stadium opened in 1999 and they will have a new one in the coming years. It's 25 years old this year.

That's what I'm getting at. Delta center is 32-33 years old and smith was pitching a new arena before getting the Coyotes. That's why to me Houston has an interest still. The titans thing is such nonsense, that field is nice too.

These owners don't need an arena, but they want one.

 

[StreetHawk]

That's what I'm getting at. Delta center is 32-33 years old and smith was pitching a new arena before getting the Coyotes. That's why to me Houston has an interest still. The titans thing is such nonsense, that field is nice too.

These owners don't need an arena, but they want one.

When it’s not their own money they want a new one. Crazy how easily the governments hand that over to them.
Delta Center isn’t configured for the nhl. So that I get. Same reason AZ offered to build new to accommodate both suns and coyotes but suns said no as they had the arena management agreement and did t want to give up half of that revenue to the coyotes.

Footprint probably won’t last longer than when their lease with the suns is up in 2037. 45 years.

 

[aqib]

Toyota center is getting up there in years. Sure, they could renovate, but would it not be better to lock down an extra 40 or so dates to justify the cost?
Ok so I was looking at the older forbes lists, to be fair, but tbf they don't have all the info. My point is that I'm not sure he is wrong when saying the return on profit or otherwise costs don't justify the expenditure.

You're right that he's not a customer, but they need him more because there are no other groups in the Houston area, unlike Atlanta. I'm sure we don't think the Coyotes were actually worth 1.2 billion. But they sold as that. And you're right Fertita won't want to pay that. The NHL should be realistic with its prices.

I agree they don't have all the info but as a result they always underestimate the value of teams. Look at any team sale and compare it to Forbes most recent valuation.

The Coyotes sold for $1.2 billion. So clearly Smith thought they were. Thats all that matters. I doubt he paid that thinking he was burning money. He's rich but not Steve Ballmer rich.

The NHL is realistic because its always able to get the price it wants.

 

[StreetHawk]

I agree they don't have all the info but as a result they always underestimate the value of teams. Look at any team sale and compare it to Forbes most recent valuation.

The Coyotes sold for $1.2 billion. So clearly Smith thought they were. Thats all that matters. I doubt he paid that thinking he was burning money. He's rich but not Steve Ballmer rich.

The NHL is realistic because its always able to get the price it wants.

I've never looked at any of these publications that do franchise valuations as the expected number they would sell for. I've always just looked at their ranking. Does it seem to make sense given the market, arena situation, team brand, on field success over the past decade, etc.

I recall seeing the Blues move up into the late teens from the mid 20's in their rankings shortly after the Rams left STL a few years back.

 

[Tawnos]

I think there’s a distinction to be made here about the Coyotes that essentially has to do with the fact that it wasn’t technically a relocation. I say technically, because the result is definitely the same as a relocation. The transaction itself was not.

Smith did not pay $1.2B for the Coyotes. He paid $1.2B for an NHL team in the SLC market. Utah HC is an expansion franchise who had the Coyotes players transferred to them in lieu of an expansion draft. The BoG approved a brand new franchise.

So when someone says that Smith looked at the Coyotes as being far more valuable than Forbes (and common sense) said they were worth, they’re framing it entirely wrong.

 

[Yukon Joe]

I think there’s a distinction to be made here about the Coyotes that essentially has to do with the fact that it wasn’t technically a relocation. I say technically, because the result is definitely the same as a relocation. The transaction itself was not.

Smith did not pay $1.2B for the Coyotes. He paid $1.2B for an NHL team in the SLC market. Utah HC is an expansion franchise who had the Coyotes players transferred to them in lieu of an expansion draft. The BoG approved a brand new franchise.

So when someone says that Smith looked at the Coyotes as being far more valuable than Forbes (and common sense) said they were worth, they’re framing it entirely wrong.

So on the one hand, you're right. Ryan Smith purchased a new franchise plus acquired all of the assets of the Arizona Coyotes (primarily being the player contracts). The Coyotes franchise was then put made "inactive".

But on the other hand - they only did that to get Meruelo on board with the sale. They gave him the right to re-activate the franchise if/when he obtained a new arena within 5 years.

The fact though is that Meruelo gave up on that possibility within weeks though, and the Coyotes franchise is now terminated.

All of which means I think it's safe to call the Coyotes a "relocation".

I will be curious to see if the NHL website does list prior seasons/records from the Coyotes (and Jets before that) as belonging to Utah. The stats part of their website doesn't seem to list Utah HC yet. But for example if you search who the goals/points leaders were for the "Winnipeg Jets" in 2009-2010 you'll find it was Nik Antropov playing for Atlanta. Similarly the goals leader for the Arizona Coyotes in 1981-1982 is Dale Hawerchuk, playing for Winnipeg.

 

[voyageur]

What is any of that based on?



The league always talks out of both sides of its mouth on expansion and relocation. The Thrashers weren't going anywhere until they were. At the All-Star Game Bettman said he beleived AM was heading towards a deal. The Coyotes were staying until the last week.

Forbes said a year ago the average NHL team is worth $1.33B and valued 21 out of 32 at over $1 billion. Thats far from a handful.

https://www.forbes.com/lists/nhl-valuations/ One of the ones below a billion was the Coyotes who just sold for $1.2B. Forbes also said that valuations went up 29% from 2023. If you added another 29% to all the other teams everyone but Buffalo and Columbus would be over $1 billion.

If you put out an open bid at say $1.4 billion you would get multiple bids but not from Fertita. Someone not willing to pay your price is not a potential customer. If I'm not willing to pay $100 for a lobster then I'm not a potential customer of a highend lobster restaurant.

It's funny because the league has quashed any talk of expansion. Fertitta is openly challenging the league to lower their asking price. Atlanta still doesn't have a rink they can play in, could be 2027/2028 before they get a team. Arizona now has a prospective owner, but does the NHL want to go back to another arena where sightlines are a major issue? The construction process for Utah to get up to standard is going to take years. Quebec has so many obstacles. At this point Hamilton's renovation of the First Ontario Centre might have them as front runners. But it's the wrong side of the border, in that push to have more American teams. Unless you ever get a Canadian Conference, which is highly unlikely.

 

[Yukon Joe]

It's funny because the league has quashed any talk of expansion. Fertitta is openly challenging the league to lower their asking price. Atlanta still doesn't have a rink they can play in, could be 2027/2028 before they get a team. Arizona now has a prospective owner, but does the NHL want to go back to another arena where sightlines are a major issue? The construction process for Utah to get up to standard is going to take years. Quebec has so many obstacles. At this point Hamilton's renovation of the First Ontario Centre might have them as front runners. But it's the wrong side of the border, in that push to have more American teams. Unless you ever get a Canadian Conference, which is highly unlikely.

So thing to remember is that the NHL can afford to take a long view of things.

Take Seattle for example. City started a process to renovate the arena in 2016. Deal struck to renovate arena in 2017, and at the same time NHL officially explores expansion. 2018 expansion franchise announced. Expansion draft and team's first season in 2021.

The issue with the NHL is always, and will always be, is if someone is willing to pay the price. They'll put up with waiting for an arena, or waiting for renos, for quite awhile - if they get their money.

 

[Tawnos]

So on the one hand, you're right. Ryan Smith purchased a new franchise plus acquired all of the assets of the Arizona Coyotes (primarily being the player contracts). The Coyotes franchise was then put made "inactive".

But on the other hand - they only did that to get Meruelo on board with the sale. They gave him the right to re-activate the franchise if/when he obtained a new arena within 5 years.

The fact though is that Meruelo gave up on that possibility within weeks though, and the Coyotes franchise is now terminated.

All of which means I think it's safe to call the Coyotes a "relocation".

I will be curious to see if the NHL website does list prior seasons/records from the Coyotes (and Jets before that) as belonging to Utah. The stats part of their website doesn't seem to list Utah HC yet. But for example if you search who the goals/points leaders were for the "Winnipeg Jets" in 2009-2010 you'll find it was Nik Antropov playing for Atlanta. Similarly the goals leader for the Arizona Coyotes in 1981-1982 is Dale Hawerchuk, playing for Winnipeg.

But again, what I'm saying isn't about the ultimate result of the transaction. It's about the transaction itself. Ryan Smith paid $1.2B for an expansion franchise. Full stop. In the context of franchise values, it's not the Coyotes who were ultimately worth $1.2B. It was an expansion franchise.

It's one of the main reasons the NHL chose to do it this way. So when they were looking at more traditional expansion, they could say "we got $1.2B for an expansion team in 2024. What are you going to offer us in 2026 (or whenever)?"

 

[StreetHawk]

So thing to remember is that the NHL can afford to take a long view of things.

Take Seattle for example. City started a process to renovate the arena in 2016. Deal struck to renovate arena in 2017, and at the same time NHL officially explores expansion. 2018 expansion franchise announced. Expansion draft and team's first season in 2021.

The issue with the NHL is always, and will always be, is if someone is willing to pay the price. They'll put up with waiting for an arena, or waiting for renos, for quite awhile - if they get their money.

NHL has historically been about getting their money for their franchise vs location of said team.
So, they have no problems not being in Houston if TF won’t meet their price. And if no one else is looking to build another arena they will just move forward without this market.

NHL wanted the Pacific Northwest for a very long time since the expansion in the early 90’s. When the Seattle bid was screed over by the then nba Sonics owner. They were also disappointed that Allen did not apply for that round in the late 90’s for Portland. But moves in without a team in that area of the USA.

 

[voyageur]

So thing to remember is that the NHL can afford to take a long view of things.

Take Seattle for example. City started a process to renovate the arena in 2016. Deal struck to renovate arena in 2017, and at the same time NHL officially explores expansion. 2018 expansion franchise announced. Expansion draft and team's first season in 2021.

The issue with the NHL is always, and will always be, is if someone is willing to pay the price. They'll put up with waiting for an arena, or waiting for renos, for quite awhile - if they get their money.

It's one part money I think. Quebec could have easily paid the $500 million, NHL wanted Vegas, for obvious reasons. NHL wanted Seattle. I think losing both Arizona and Atlanta stings the league brand a little, where losing consistently with bad ownership in the Southern U.S can lead to relocation.

Atlanta for sure will get a team, once the process is all done. No one has any actual idea though what the league thinks an expansion franchise is worth after $650 million for Seattle. I do get the sense with all the CBA talk that they would like to get this one in before the next CBA.

I can't see the league caving in to Fertitta. The Arizona relocation was the perfect chance to offload the league's least valued commodity, at a bargain price, and it didn't happen. Lowering expansion fees to get a market in essentially would undo what the Coyotes sale accomplished, in terms of franchise valuations.